Glenside West Corp. v. Exxon Co., USA

761 F. Supp. 1118, 1991 U.S. Dist. LEXIS 5230
District Court, D. New Jersey·Decided April 8, 1991·No. Civ. A. 90-1333 (AJL)·Published·Cited by 23 cases

Opinion

OPINION

LECHNER, District Judge.

This is an action brought by plaintiff Glenside West Corporation (“Glenside”) against Exxon Company, U.S.A., a Division of Exxon Corporation (“Exxon”), and counterclaims brought by Exxon against Glen-side arising out of the decision by Exxon to terminate the retail motor fuel service station franchise of Glenside (Glenside and Exxon are collectively referred to as the “Parties”). Glenside alleges jurisdiction pursuant to the Petroleum Marketing Practices Act (the “PMPA”), 15 U.S.C. § 2805. 1 Exxon alleges federal question jurisdiction pursuant to 28 U.S.C. § 1331 and jurisdiction pursuant to 28 U.S.C. § 1337.

On 13 February 1991, Exxon filed a motion for a temporary restraining order and a preliminary injunction to restrain and enjoin Glenside from continuing to conduct its service station business on Exxon’s property located at 2591 Route 22, Scotch Plains, New Jersey (the “Service Station”), from continuing to maintain possession of the Service Station, from communicating with or coming within close proximity to Exxon employees Anthony Luciano (“Luciano”) and William Cruikshank (“Cruikshank”) and from coming within close proximity of the Service Station and Exxon’s Linden, New Jersey offices and facilities (the “Linden Offices”). In addition, Exxon moved to supplement its counterclaims to include the criminal convictions of Robert E. Lee, Jr. (“Lee”), the president and sole shareholder of Glenside, as a ground for terminating the franchise relationship under the PMPA, 15 U.S.C. § 2802.

Oral argument on Exxon’s motion for injunctive relief and to supplement counterclaims was held on 25 February 1991. 2 In a decision announced from the bench on that date, the Exxon request to enjoin Glenside from continuing to conduct the Service Station business and from continuing to maintain possession of the Service Station was rejected. It was determined such injunctive relief was not appropriate at that time because it would effectively dispose of the case on the merits by terminating the franchise business. The parties were advised such injunctive relief was more appropriately the subject of a motion for summary judgment.

The Exxon motion for an injunction restraining Lee, the president and sole shareholder of Glenside, from coming within one hundred yards of the Linden Offices, the Service Station and Exxon employees Luci *1121 ano and Cruikshank was granted. See Oral Arg. Tr. at 2-9. In addition, Exxon was permitted to supplement its counterclaims pursuant to Fed.R.Civ.P. 15(d) to include the convictions of Lee as a ground for termination under the PMPA. Id. See also 26 February 1991 Order; 28 February 1991 Order.

Exxon now moves for partial summary judgment on the issue of the lawfulness of Exxon’s termination of the Franchise Agreement under the PMPA, 15 U.S.C. § 2802. In addition, Exxon renews its application for injunctive relief to enjoin Glen-side from operating and from maintaining possession over the Service Station, as requested in its counterclaims. 3 Oral argument on Exxon’s motion for partial summary judgment and on its application for permanent injunctive relief was held on 22 March 1991 (the “22 March 1991 Oral Argument”).

For the reasons which follow, the motions for partial summary judgment and for permanent injunctive relief are granted. In addition, the reasons for the 25 February 1991 determination enjoining Lee from approaching the Service Station, the Linden Offices and Luciano and Cruikshank and permitting Exxon to supplement its counterclaims are set forth. Finally, the preliminary injunction enjoining Lee from approaching the Service Station, the Linden Offices and Luciano and Cruikshank is converted to a permanent injunction.

Facts 4

Glenside, through Lee, entered into a franchise relationship with Exxon sometime around April 1985 for the operation of the Service Station. Amended Complaint at 5-6. The franchise relationship was based on a lease agreement (the “Lease Agreement”) and retail sales agreement (the “Sales Agreement”) between the Par *1122 ties which authorized Glenside to use Exxon’s trade mark in connection with the sale, consignment or distribution of gasoline, motor oil and related products (the Lease Agreement and Sales Agreement are collectively referred to as the “Franchise Agreement”). Amended Complaint at 6. The Parties renewed the Franchise Agreement on or about 27 September 1987 for the period 1 January 1988 to 1 January 1991. Amended Complaint at 8.

On or around 4 January 1990, Glenside received notice from Exxon of Exxon’s intention to terminate and not renew the Franchise Agreement effective 15 April 1990. Amended Complaint at 2. Exxon based its decision to terminate on Glen-side's failure to make timely rental payments for October and November 1989 and on Lee’s alleged threat to injure Exxon’s personnel and damage its property. Amended Complaint.

On 3 April 1990, Glenside filed its Complaint for Preliminary and Permanent Injunction, seeking to enjoin Exxon from terminating the Franchise Agreement. See Complaint for Preliminary and Permanent Injunction (the “Complaint”). It withdrew its request for a preliminary injunction on 31 May 1990 and filed the Amended Complaint on 10 August 1990. See Amended Complaint. The Amended Complaint now contains six counts. 5 Count One alleges Exxon seeks to terminate the Franchise Agreement with Glenside in violation of the PMPA, 15 U.S.C. § 2802. The remaining counts appear to be based on violations of New Jersey law. 6

Exxon filed its Answer and Counterclaim on 30 April 1990, its Answer to Amended Complaint and Counterclaims on 31 August 1990, and, with the consent of Glenside, the Supplemental Answer to Amended Complaint and Counterclaims on 28 December 1990 (the “Supplemental Counterclaims”). In Count I (the “First Counterclaim”) of the Supplemental Counterclaims, Exxon alleges the failure of Glenside to make timely rental payments for the months September 1988 and April, October and November 1989, August, September, October, November and December 1990 and threats by Glenside against Exxon’s personnel and property constitute grounds for termination and nonrenewal pursuant to 15 U.S.C. §§ 2802

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Glenside West Corp. v. Exxon Co., USA, 761 F. Supp. 1118, 1991 U.S. Dist. LEXIS 5230 (D.N.J. 1991).

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